New York State Residents

• New York Lotto winnings can be subject to New York state taxes even for nonresidentsNA/AbleStock.com/Getty Images
  
  All New York State Lotto winnings awarded to New York State residents are subject to New York State income tax. Winnings over 5,000 dollars are subject to withholding. As of 2011, New York State income tax withholding is 8.97 percent.
  
  

Out-of-State Residents

• Residents who move out of New York are still liable for New York taxes on their winningsComstock/Comstock/Getty Images
  
  After October 1, 2000, New York State Lotto winnings in excess of 5,000 dollars are subject to New York State income tax for non-residents. This also applies to tax withholding requirements. If a non-resident of New York later becomes a resident of New York while still receiving installment payments of Lotto winnings, the installments paid while the winner is a New York resident is subject to New York State income tax. In fact, if a New York State resident wins the Lotto, but moves to another state before receiving any payments, the entire amount is still subject to New York State income tax, even the amounts paid while no longer a New York State resident. Residents of other states may also be liable for state income tax payable to their state of residence in addition to the taxes paid to New York, although most states allow some sort of credit for taxes paid to a different state.
  
  

New York City Residents

• As of 2011, New York City taxes on Lotto winnings are almost 4 percentNA/AbleStock.com/Getty Images
  
  If the winner of the New York Lotto is not a resident of New York City or Yonkers when he won the lottery, but subsequently moved to one of those cities, any installments received after the move will be subject to city tax. Just as with state taxes, if the winner moves from New York City after winning -- even if he moves to another city in or out of New York State -- all installment payments received after the move are still subject to New York City tax. As of 2011, the New York City tax withholding rate is 3.876 percent and Yonkers is 1.3455 percent.
  
  

Withholding

• Taxes are automatically deducted from all disbursements of Lotto winningsComstock/Comstock/Getty Images
  
  On winnings over 5,000 dollars, the State of New York is required to withhold the income taxes from the proceeds using the highest effective rate of state tax for the year in which the payment is made with no adjustments for exemptions or deductions. In addition to New York State taxes, all New York Lotto winnings are subject to federal income tax withholding, which is 25 percent as of 2011.
  
  

Estimated Tax

• Tax day could come more often for Lotto jackpot winnersComstock/Comstock/Getty Images
  
  New York State Lotto winners could be required to pay estimated taxes -- that is, make tax payments quarterly instead of annually. The estimated tax rule is determined by total income tax liability as described in the Form IT-2105 or Form IT-2106.